Archive for March, 2009

DELL’s distribution agreement announcement is sending shock waves throughout the industry larger than rumors of IBM-SUN merger discussions. The availability of a subset of theDELL product line through broad line distributors Ingram Micro and Tech Data has ramifications for every value added reseller in the channel. The worst kept secret in the industry for years has been the percentage of DELL desktop and laptop business that has either been sold or influenced by the channel. I’ve never seen an accurate estimate of how many Dell desktops have been “sold” by the channel through the influence of a solution provider either for a configuration fee or simply as part of the overall solution package. And of course Dell has used broad line distributors for years to provide the logistics of their third party options. However the public announcement of a formal relationship between DELL and Ingram Micro/Tech Data legitimizes the entrance of Dell into the channel supply chain. (more…)

Every day the news is full of information regarding the worldwide financial and credit crisis. While the economic “downturn” is affecting every aspect of IT business from overall sales to an increased emphasis on green computing, the reduction of available credit is a fundamental business change that has the potential to drastically change the IT channel model. While it’s not as sexy as a headline describing a looming depression, if partners are unable to buy products, they can’t sell them!

We are already seeing a drastic reduction in the available credit, with IBM Global Financing terminating a program that provided multivendor reseller financing. While distributors claim to not have reduced their lines of available credit, as the economy takes its toll on VARs, we will definitely see distributors increase their vigilance in reviewing open lines of credit. And the smallest VARs that rely on credit card and home equity financing have seen those lines arbitrarily reduced or terminated with no review of the VAR business financials. This is not only affecting smaller VARs., we hear reports of $100M+ partners reviewing their available credit and looking for creative financing. The Channel Insider 2009 Market Pulse Report, a biannual study of economic activity and key performance indicators of the North America technology reseller and services channel, indicates over half of partners surveyed are concerned with tightening credit and payment terms.(more…)

How HP is using its vast Resources to Help SMB customers and Partners survive the Downturn

The fact that there 6.3m SMB customers in the U.S. and that they’re projected to grow 5x the rate of the market overall in 2009 isn’t news. The fact that the SMB market represents a $60+ billion dollar market for commercial computing products isn’t new either. But, amidst all the industry noise about how critical small business is to the US economy, what are the largest manufacturers really doing to help this customer segment, and more importantly the partners who service them, thrive and grow?

Well, sometimes bigger really can be better. With total revenues of over $120b and 8 of every 10 SMB customers already owning some HP equipment, HP is leveraging its vast resources and broad product portfolio to take a very active role in giving SMB customer and SMB-focused partners new reasons to invest in new equipment, get support and collaborate. Today, HP announced new products, new support, a new SaaS delivery model and new partner program offerings – all focused on the under-999 employee customer space.

I recently took my 2006 Honda Odyssey into the mechanic because as I was driving to work the dashboard light indicators were lighting up like a Christmas tree. It began with a bright red brake indicator, next came the oil light, then “maintenance required”, and finally some random light I still don’t know the meaning of. So, I started thinking – can I even make it to the mechanic, should I call a tow truck, will I miss my meeting? Not to mention that this will undoubtedly mean, ka-ching – an unanticipated expense!

This experience got me thinking about our business. What if I just ignored my dashboard? I mean, yes the indicators were on but the car was actually running and sounding fine. In the old days when I drove my 1980 hand-me-down Chevy Citation, there weren’t any sensors on the dashboard. I just drove the car until, well, it broke down – and trust me I got more than my fair share of that back in “the old days.” However, today’s cars are fine-tuned, high-tech machines with lots of thing-a-ma-jigs that make sure I can brake to a stop faster, I won’t get as hurt in an accident, I get better mileage, etc. So yes, I could probably still drive “old school” like I did in my younger days and ignore the flashing dashboard. But at what cost?